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Choosing a car that is cheap to insure


Monthly insurance rates that look more like car payments kill the thrill fast.

Car insurance rates are mostly determined by who the driver is, not the car itself. But the wrong driver in the wrong car in the wrong city is a recipe for bills of epic proportions.

Choosing the right car doesn’t mean we all drive minivans. It does mean looking at the cost of insuring a car before you sign on the dotted line and making insurance a part of your financial calculations.

Below you’ll find the five most common questions we get from our readers about how much the types of car affects their insurance rates.

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Which cars are the cheapest to insure?

The boring ones.

You expected something else? Our rule of thumb: If you can rent it at an airport, it’s probably cheap to insure.

But pricing is more complicated than that. The vehicle-specific portion of your rates actually hinges on its “loss history,” meaning how many claims are filed on that model and how expensive those claims are to pay. The $18,000, 180-horsepower Scion TC and the $50,000, 425-horsepower Chevrolet Corvettes cost the same to insure. One is driven by teenagers, the other by middle-aged men.

One of these groups makes many more claims than the other. Guess which.

Insurers look at how often your car is stolen, how often it’s wrecked, and how often people are injured in those wrecks. Many rely on a ratings number from the Insurance Services Office. The higher the number, the higher the premium. Sadly, those ratings aren’t public.

Read more: Does a two-door cost more to insure than a four-door?

How can I insure a salvage title car?

Probably you’ll be unable to find anyone willing to do so. No one really knows what a salvage title car is worth, making it difficult for an insurance company to value it properly so that physical damage to the car is covered. You may be able to find liability coverage.

In general, salvage title cars are for cash-rich gearheads only. Banks won’t finance them, insurers won’t cover their replacement cost, and they are almost impossible to resell for both those reasons.

Read more:  What is a rebuilt or salvage title?

What is the average auto insurance rate?
It depends on many, many factors. But location and age are two main factors, so use our average insurance rates by ZIP code and average insurance rates by age resources. You can tell whether you are paying dramatically higher or lower rates than the norm in your neighborhood or age range. The affect of age on car insurance rates levels out once you turn 25.

But averages don’t reflect the details of your own car, driving history or policy. The best way to see what the rates are like for you and your car is simply to get a quote.

Read more: How much does car insurance cost, and why?

Is my brand-new car automatically covered?

If you had insurance on your trade-in, yes. The new car is covered under the terms of your old policy. If you had liability insurance before, you have only liability coverage afterward, at least until you change your policy. You’re required to notify your insurance company when you switch cars, though the time limit varies by state.

If you didn’t have a previous policy, you’ll have to arrange for insurance before you drive away.

If you’ve financed the car, your bank will contact your insurance company for proof that you’re covered. If they don’t get it, they’ll purchase a policy for you at a shockingly high price. You don’t want that.

When should I take full coverage off my older car to save money?

You should stop carrying full coverage (meaning collision and comprehensive coverage) when your deductible and your physical damage coverages premium starts to equal your vehicle's actual cash value.

If you have a $500 deductible and your car's value is $3,000, then the most you can recover in a total loss is $2,500. At this point, you need to decide if it is worth it for you to pay the collision and comprehensive coverage portion of your auto insurance.

If the premium amount still makes economic sense to pay, then you should keep full coverage. If the car is worth so little you can afford to buy a replacement outright, drop full coverage.

Read more: How do I find the actual cash value (ACV) of my car?

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